The Hill
September 10, 2012

Kaiser: Repealing health law raises Medicare costs for seniors, government

Repealing President Obama's healthcare law would raise seniors' costs as well as federal spending, the Kaiser Family Foundation said Monday.

The analysis bolsters Obama's argument on Medicare. He has said Mitt Romney and Paul Ryan's plan to repeal the healthcare law would increase seniors' costs immediately.

Kaiser noted that the Affordable Care Act lowered seniors' costs in several ways. Repealing it would therefore increase those costs. The law also makes several efforts to make the healthcare system more efficient.

"Repeal of the ACA would undo these changes, raise costs for beneficiaries, and increase federal spending at a time when the nation is struggling to address the deficit and debt," Kaiser's brief states.

If Congress repealed the healthcare law, seniors would pay more for Medicare benefits that cover hospitals, doctors' offices, prescription drugs and preventive services.

The law gradually closes the Medicare "doughnut hole," in which seniors must pay for all of their prescription drugs, and makes preventive services available without cost-sharing.

Kaiser also noted, as Obama often does, that the law extended Medicare's solvency. The program's bipartisan trustees said the ACA's provider cuts — the $716 billion in savings that Romney and Ryan have so aggressively criticized — extended Medicare's financial standing by 12 years.

The Medicare trust fund, which only covers hospital benefits, would become insolvent in 2024 under current law, Kaiser said. The fund would become insolvent in 2016 if the ACA is repealed.

"Because the ACA is expected to reduce net spending over ten years, repealing the ACA would increase net Medicare spending by $716 billion over ten years," the Kaiser brief says.

Romney and Ryan want to partially privatize Medicare, giving seniors a choice between the existing program or a subsidy to buy private coverage. They say those steps are necessary because Medicare is too expensive. Yet Romney has pledged to eliminate the $716 billion in savings under the Affordable Care Act.

Ryan previously proposed keeping those savings in place while repealing the rest of the ACA, using the Medicare savings for overall deficit reduction. But Romney has said he would reverse the cuts, increasing Medicare payments to healthcare providers and insurance companies.

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